News Feature | June 26, 2017

Acquisitions Make Consumers More Likely To Shop With Parent Companies

Christine Kern

By Christine Kern, contributing writer

Amazon Prime HBO Shows

Amazon and Walmart are in an acquisitions race for new customers.

While Amazon announced its plan for a grocery takeover with the $310 billion acquisition of Whole Foods, Walmart has its sights set more on luxury retail with a $310M acquisition of Bonobos. With its acquisitions of smaller retailers including ModCloth, Moosejaw, and now Bonobos, Walmart is vying to boost its reputation by buying companies known for high-quality products.

As competition for customers continues to heighten, retailers are gambling that these acquisitions will make an important difference with their audience. New Walker Sands data reveals that 18 percent of consumers report being more likely to shop at Walmart after their acquisition of and another 18 percent report the same after the ModCloth acquisition. That could mean a major boost in revenue if Walmart leverages these new assets effectively.

In an email, Scott Webb, President of Avionos stated that he thinks these moves speak directly to the shifting digital retail experience. He said, “The recent moves by Amazon and Walmart are a recognition that the path forward for success is centered around providing a compelling experience wherever the consumer wants to transact.  Walmart, the leader in traditional physical retail, is recognizing that they need a better experience with the brands and products they are offering, both online and instore. Amazon, the clear leader in the digital experience, is recognizing  that there is still a compelling need to have a physical presence where they can support their customers’ full experience needs.”

And Lauren Freedman, SVP of Digital Strategy at Astound Commerce, thinks this acquisition is part of Walmart’s push to be known as more than just the cheapest guys in ecommerce. The company is ramping up their ecommerce efforts to compete with Amazon, and Bonobos could be a key player in shifting the online apparel game in their favor.

As retailers aim to attract millennials and higher-income customers into their stores, they are banking on new and different acquisitions to ring in the sales.